Gold prices surged to a new record high on concerns about escalating geopolitical tensions in several parts of the world and news surrounding the US election, according to commodity analysts at ING.
“Traders are seeking safety in gold after Israel announced that Hamas leader Yahya Sinwar had been killed,” said commodity strategist Ewa Manthey and director of commodity strategy Warren Patterson.
According to Reuters, on October 17, Israeli Foreign Minister Israel Katz announced the elimination of leader Yahya Sinwar - the mastermind of the massacre in Israel on October 7, 2023 that killed 1,200 civilians.
The Israeli military said Yahya Sinwar was one of three Hamas members killed in a ground attack in the southern Gaza Strip city of Rafah, but did not specify when it happened.
Gold prices have risen more than 30% year-to-date on optimism about interest rate cuts, central bank buying and strong Asian demand.
"Safe-haven demand amid heightened geopolitical risks and headlines ahead of the US election in November has supported gold's record rally this year. We believe the macro picture combined with safe-haven demand amid escalating tensions in the Middle East and the ongoing war in Ukraine will send gold to new highs," the analysts said.
Experts believe that the momentum from the US presidential election will continue to push gold prices higher until the end of the year, regardless of which party wins: "Central banks are also expected to continue to increase their holdings, which will be supportive."
Given the above factors, according to Peter Schiff - chief market strategist of Euro Pacific Asset Management, gold prices will increase in the long term.
Technical analysts are also analyzing the implications of gold's new high, with some warning of a short-term pullback before the precious metal continues its rally.
Spot gold continued to set new record highs on Friday morning, trading last at $2,719.32/ounce, up 0.98% on the daily chart. However, at the time of writing (1:50 a.m. October 19, 2024 - Vietnam time), world gold prices continued to break the peak, listed on Kitco at an unprecedented high of $2,719.9/ounce.
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